1. Talent Management: A Sector Approach Team Azizi Arshad Hassim Sandile Sokhela Dumile Makapela Johlene Narayadu

2. Talent Management Our Definition:  Attract,  Develop, and  Retain high potential and performing individuals

3. Challenge How to create an environment as a Banking Sector where we can: Attract,Attract, Develop; andDevelop; and Retain top talent within the Banking SectorRetain top talent within the Banking Sector

4. Current Situation  Financial Sector Charter targets: Senior Level  Few Black female executives  HIV/AIDS pandemic  Economy growing at 4.9% (target 6%)  Aggressive Head Hunting of Black Talent  Exit of Talent to Explore Opportunities outside the Sector Supply and Demand Imbalances

5. Attract, Develop and Retain Entry into the Sector Exit Banking Sector Career Development SKILLSSHORTAGESKILLSSHORTAGE

6. Attract, Develop and Retain Entry into the Sector Exit Banking Sector Career Development SKILLSSHORTAGESKILLSSHORTAGE

7. Entry into the Sector Banking Sector Symptoms 30% graduates unemployed 30% graduates unemployed Talent from other sectors reluctant to enter the Talent from other sectors reluctant to enter the sector sector International Executive MBA Programs do not International Executive MBA Programs do not feature South Africa feature South Africa Wits University March 2007

8. Entry into the Sector Banking Sector Supply and Demand Imbalances Supply and Demand Imbalances - Academic Institutions not meeting industry demands - Lack of Sector Brand Awareness -Empowerment Entrepreneurial Opportunities - Lack of Understanding of generation X and Y different expectations different expectations Root Causes

9. Entry into the Sector Banking Sector Recommendation

10. Sector Collaboration Eliminating barriers to Entry Develop Industry Entry Level Qualifications e.g.Develop Industry Entry Level Qualifications e.g.  Financial Markets  Bank Financial Risk Management  Customer Relationship Management Align current Academic curriculum to industry needsAlign current Academic curriculum to industry needs  Identify key skills needed for the future in the banking sector (5yrs)  Where is talent demand outpacing talent supply currently  Which segments of the workforce create value

11. Eliminating barriers to Entry Market the sector to improve its brand:Market the sector to improve its brand:  Positioning of Bankseta  Buy-in and support from Government  Career days  Advertise  More in-service training opportunities Sector Collaboration

12. Entry into the Sector Banking Sector How: Implementation

13. Sector Collaboration Proposal Form Interbank committee Institute of Bankers BankSeta Banker’s Association BankSeta Driver

14. Value in Collaboration  Toronto Financial Services Alliance Enhance and promote the competitiveness of TorontoEnhance and promote the competitiveness of Toronto Promote locally and internationally, the capabilities of the industryPromote locally and internationally, the capabilities of the industry  International Financial Services of London (IFSL) Promotes the skills and expertisePromotes the skills and expertise Raise awareness of the size and importance of LondonRaise awareness of the size and importance of London  Invest Australia (AXISS Australia) Global financial services centre in the Asian time zoneGlobal financial services centre in the Asian time zone Advice to Government: financial policy, regulatory and market structure issuesAdvice to Government: financial policy, regulatory and market structure issues

15. Attract, Develop and Retain Entry Exit B anking Sector Career Development SKILLSSHORTAGESKILLSSHORTAGE

16. Symptom SA Bank Scenario 1: SA Bank Scenario 1: Profits after-tax R10bn R525 000 x 35000 x 20% x 15% = R 551,250,000.00 per annum SKILLSSHORTAGESKILLSSHORTAGE Job-hopping could be costing South Africa more than R25bn a year based on SA Reserve bank figures.

17. Symptom : High Turnover  1.5x Salary : Cost per Individual (Fortune 500)  Hurt Factor of 20%: consistent with international literature  Turnover of 15%: range 8% to 23%  Number of Employees: 35000 consistent with the Big Banks in SA  Mid Point: Middle Management band as defined by the Old FSC Charter Codes  Top Talent = 7000 employees  Cornel University : (1.5x)*(Top Talent)*(Annual Turnover Rate)

18. Root Causes  Inequalities of the past has resulted in a lack of experience in previously disadvantaged individuals  Slow pace skills transfer at middle & senior management levels  Emigration of South African talent due to globalisation  Shortage of skills has resulted in the war for the same talent by the banks  Generation X and Y have different expectations Entry Banking Sector Career development

19. Entry Banking Sector Career development Recommendation

20. International Exchange Programs Accelerate Skills Transfer through Secondments  Career Customised Approach  Technical or Leadership positions (Middle or Senior)  Post Graduate Academic Qualifications A Two way relationship between South Africa and Canada

21. Benefits Attraction Retention Best practice Competitive pressures Cost effective Reduced risk Enduring legacy value Investment opportunities Credibility versus Colour Deeper skills pool High morale Loyal employee Enhanced culture Improved continuity Retention

22. Why should TFS Engage?  Embedded Value Capabilities ING InsuranceING Insurance  International Financial Reporting Standards Implementation Canadian Bankers AssociationCanadian Bankers Association  Mining Finance National BankNational Bank

23. Other Areas of Interest  Mortgage Finance  Asset Management: Product Development  Mobile Banking  Debt Capital Markets

24. Entry Banking Sector Career development Implementation

25. International Exchange Program BankSeta TFSA / Immersion Lab Identify Competencies Identify Candidates Engage with South African banks Identify Competencies Identity Candidates Engage with Canadian banks

26. Conditions for SA  Middle to Senior high potential Individuals  3 – 4 years with the Organisation  Service Contracts: Similar to MBA

27. Top International Banks  Deutsche Bank  Merrill Lynch  Citigroup  JP Morgan International Exchange Programs key to development

28. Entry into the Sector Retention Banking Sector Career Development SKILLSSHORTAGESKILLSSHORTAGE Talent Management

29. What is the Link? Employee Commitment Customer Loyalty Revenue

30. The Business Case Employee Commitment Customer Loyalty Revenue 5% 3% Source: CIBC Analytics Over 18 to 24 months

31. Academic Supporting Research

32. Cappelli (2000) Mechanisms for retaining employees  Job customisation;  Job design;  Compensation  Social ties;  Location;  Hiring and retaining the most valuable employees. Cappelli, P (2000): A market –driven approach to retaining talent, Harvard Business Review, January-February: 103 -111.

33. Cappelli (2000) Concluded  market, and not the organisation, will ultimately determine the movement of employees.  Organisations may be able to counter the push factors  Organisations cannot counter the pull factors

34. Cappelli Recommends retention strategies should focus  key employees or groups of employees  an understanding of employee’s perception of the labour market. Perceptions are influenced by  culture,  past experience,  environment,  families and  peer groups

35. In Summary  External challenges require sector collaboration We have the means to eliminate some of the existing barriersWe have the means to eliminate some of the existing barriers We have the means to enhance the sector brandWe have the means to enhance the sector brand  Capacity building: locally and internationally Improve the pace of skills transfer to fast track growth in theImprove the pace of skills transfer to fast track growth in the economy economy Promotion of capable individuals i.e. credibility versus colourPromotion of capable individuals i.e. credibility versus colour

36. Thank You The objective is not to prevent employee loss, but to control its frequency and timing. Cappelli (2000) but to control its frequency and timing. Cappelli (2000)