Talent Management The right people in the right place at the right time XBHR Annual Conference 1 March 2012 Michael Burd

Finding the best talent – in all fields!

What is talent management? (CIPD 2008)

To sustain economic growth, by 2030 the United States will need to add more than 25 million workers. Western Europe will need to add more than 45 million employees. There are an estimated 214 million international migrants worldwide. Collectively, they would make up the world’s fifth-largest nation. Migration is not only a South-to-North phenomenon; 40% of the world’s migrants move from one developing country to another. Source: World Economic Forum and BCG 2011 Talent and skills scarcities – some numbers

Foreign-born workers with university or equivalent qualifications make up just 2% of the European labour market, compared with 4.5% in the United States, 8% in Australia and nearly 10% in Canada. Employability will continue to be a huge problem worldwide. Because of the uneven quality of education systems, only 25% of Indian and 20% of Russian professionals are currently considered employable by multinationals. Even China faces long-term talent shortages. The number of those aged 60+ is expanding rapidly, already forming 12.5% of the nation’s population. The country’s one-child policy and its drop in birth rates means that by 2050 the 10 workers now supporting each senior citizen will fall to 2.5. Talent and skills scarcities – some numbers (2) Source: World Economic Forum and BCG 2011

Key talent management activities Recruitment and selection Performance management and appraisal Succession planning Leadership development Retaining and motivating talent The employment life cycle Compensation

Key drivers for talent management Increasing focus on strategic human resources management and internal alignment Increasing recognition of human capital as a driver of organisational performance Prioritising talent and performance management in the recession Increased investment in developing and supporting managers Harnessing positive effect of employer branding and workplace culture on engagement and retention Balancing global and local talent needs

Talent management wheel Human Resource Management and Industrial Relations, Leadership and Organisational Studies December 2011

Business outcomes Performance at high level Recruitment costs decrease Financial performance improves Increased retention Turnover decreases Better infOrmation about internal candidates

Current challenges

Talent management objectives (%) CIPD Learning and Talent Development Annual Survey Report 2011

Most effective talent management activities CIPD Learning and Talent Development Annual Survey Report 2011

Talent management coverage CIPD Learning and Talent Development Annual Survey Report 2011

Talent shortages across largest economies Manpower Talent Shortage Survey May 2010

Enforceability of post termination restrictions UKUSAFRANCEGERMANYPOLAND When are post termination restrictions enforceable? Post-employment restrictive covenants enforceable only to the extent they protect the employer's legitimate business interests and are reasonable taking into account duration (generally not over one year), geographic area and employee’s position. Most states have a similar position to the UK (California a major exception!) Similar position to UK, but duration of up to two years can be reasonable. Must comply with statutory law. Must not exceed two years. Only available post- termination if the employee had access to important information, disclosure of which could cause damage to the employer Duration must be reasonable (but there is no defined limitation). Compensation required? No Yes, usually at least 30% of salary during the restriction period Yes, at least 50% of salary during the restriction period Yes, at least 25% of salary during the restriction period

1.What approaches to human capital talent management are multi-national corporations adopting at this time? Are any such approaches currently in vogue or out of vogue? 2.What are the legal pitfalls that employers in your respective jurisdictions need generally to consider when recruiting externally or developing top talent? Are there any special issues when recruiting or promoting across borders? 3.To what extent are talent management systems affected by external megatrends, such as recession, the war for talent, diversity in populations/workforces, generational mixes or the way ‘work’ is changing? 4.What are the best (or worst) things you’ve seen in performance reviews? Are there some best industry practices for assessing and rating performance? What kind of performance documentation/feedback works best? Are employee self- evaluations a useful tool? Questions for discussion

5.What issues arise from performance management systems applied across borders and cultures? For example, do 360º feedback, review panels and/or self-assessments translate well or badly across geographies? Are there legal issues in different jurisdictions? 6.Has the ‘up or out’ culture died, or is it still alive and kicking? 7.Is it workable to focus talent management just on top performers or is underperformance management equally important? 8.Can you retain talent by ‘force’ e.g. through aggressive use of restrictive covenants? 9.Should Legal play any role in the development and implementation of a talent management system or should Legal “butt out” and leave it to HR and the business people? Questions for discussion (2)

Thank you