The outspoken US Ambassador Robert Blake addressing the CIMA Business Leaders summit asserted that the education system in the country was not delivering the volume and quality desired. Highlighting the areas of growth in the Lankan economy Blake noted that in the new economy it was knowledge and training of the people that was imperative to build competitive advantage. Moreover Blake pointed out that most Sri Lankan graduates were unable to find jobs, as universities were not affiliating themselves with business establishments and the lack of knowledge and the fluency in the English language also contributed to this crisis. No doubt the Ambassador has done his homework and his comments are clinically focused. However, his comments are nothing new to many of us. We all know human resource managerial problems in the public sector and low productivity in the public and private sectors remains a priority concern for both the private sector and the public sector. But the real concern in the economy now is the movement of commercial savvy and skilled talent to developed markets like Canada, Australia, UK and South East Asia. Furthermore developed countries have progressed from simply relaxing their laws to actively luring highly qualified people. In addition many of them are using their universities as magnets for talent. As a result we do not have enough talent to go round, so to stop the drain and lure back some of our brightest people back, the private sector and the government needs to collectively address this issue before we totally lose the battle for brain power and wreck our future economic potential.
Today the Indian sub continent is becoming an employee market, with job seekers having the power of choice. Candidates are increasingly selective and know their market value. It is a candidates’ market as more of them are turning job offers or negotiating salaries aggressively. Take Sri Lanka, according to our research the quality of candidates applying for jobs have declined by over 20% and the time taken to fill vacancy has increased from around 40 days to about 90 days, this is despite the number of CVs being received having increased compared to five years ago. Good jobs are going begging and compensation skyrocketing due to the shortage of right people with the required financial sophistication. The brain drain and poor HRD strategies have contributed to this problem and made it difficult for companies to fill critical short-term talent gaps. The demand for vertical skills and companies looking for a closer fit is putting pressure on recruitment consultants to move the limited talent from one company to another at a much faster pace causing mush anxiety to HR managers. Companies are willing to pay big bucks to recruitment consultants to prevent their business growth languishing in the face of shortage of the right talent; these companies have thus been involuntary contributors to a big increase in salary levels. In today’s context a talented employee can be as valuable and hard to replace as a loyal customer. Even more so in companies where value is created by knowledge and information. In fact Lee Kuan Yew argued many years ago that “trained talent is the yeast that transforms a society and makes it rise.” Brainpower as we all know is today the foundation of value creation, therefore injecting an endless stream of good talent into the veins of the business and building the best team in the industry would become the key to ensure that organizations excel in the new global market place, deliver constantly superior products and services and set standards that others can follow.
Winston Churchill 43 years ago observed that ‘the empires of the future will be empires of the mind.” In many developed world our immigrants tend to get criticized unfairly by the press. Many top economies of the world would be lost without our qualified professionals, and many governments would still be very happy to attract our best talent. The most mobile people are not political refugees, but the educated, and they are being sought after as never before. Most governments are easing restrictions on the entry of qualified people. One of the best programmes for drawing in good human capital was initiated in the 80s by the Singapore government. The initiative helped Singapore to attract some of our best brains and even today continues to go out of its way to attract and import foreign talent. For a start the government should focus on wooing our professionals working abroad by making it very attractive for them to come back. But the government’s effort will all depend on whether the country is backed up by a vibrant economy and also managed professionally. A combination of sensible government policies and economic liberalization could work wonders for us. Our best bet would therefore to woo back some of our top Sri Lankan expatriates who have gone abroad to make their money but still feel the tug of their home country. We need to introduce attractive incentives that can entice them to return and also to retain our existing talent. However, despite the incentives they will not return until and unless we improve our governance record and manage the economy professionally. In addition to this the government should initiate a program in consultation with the private sector to equip our university graduates with the required skills set to ensure that our graduates become employable to fill short-term skill gaps.
Business Leadership Challenges
In a recently concluded poll around three quarters of Senior Human Resource Managers interviewed said that attracting and retaining their key talent was their number one, two and three priority for their businesses. Some 60% worried about the company wide talent shortages. Often companies are fond of the maxim employees our most important asset, yet beneath the rhetoric too many CEOs still regard – and –manage – employees as costs. This is dangerous because for many companies the people are the only source of long- term competitive advantage. Therefore companies that fail to invest in employees jeopardize their own success and survival. If the CEO is expected to build and motivate talent it calls upon competencies of character more than technical expertise among CEOs. It relies upon on higher order abilities to create unity and harmony, to instill trust, to create hope and optimism and to work from a base of shared values and interdependence. Leadership of this type is often indirect and behind the scene vs. from the front and top down. Today Motivating people is very different to what it was some years ago, because nowadays, oversees assignments, stock options, casual dress and free gyms are just as important to attracting and retaining talented employees as salaries, job security and careers once were. A happy workforce can reward a company through better profits, better productivity and lower staff turnover. Also there is no special magic in being a good employer. It does not necessarily take money, size, or market to become an employer of choice. Rather, enlightened HR policy and leadership that is committed to its staff.. It is organizational capabilities that create products and services that result in a customer taking money out of their wallets and putting it into ours instead of giving it to their competitors. Therefore a Chief Executive should be committed to creating and sustaining value through people. Secondly he must have some understanding as to how HR can create and deliver value to the business. Thirdly he must get his HR teams to make a strong contribution to the share price and the development of the company. However, the real problem is that most CEOs still do not know how to increase their organization’s competence. As a result the HR managers influence in the organization tends to get marginalized. Furthermore there is so much evidence that good HR practices help to unlock the full value of people capability to deliver business results, and since CEOs are accountable for delivering the numbers they should champion good HR practices in their organization to provide the personal sense of passion that count so heavily for a meaningful work experience and for good business performance.
Globalization has left only one true path to profitability for firms operating in high wage markets, to base their competitive strategy on exceptional human resource management practices. Any benefits that historically have been associated with superior technology and access to capital are now too fleeting to provide sustainable advantage. As this former source of advantage become less relevant, managing human resources by instinct and intuition becomes not only inadequate but also dangerous. The most successful countries in the future will be those that manage their people like the assets they are. In the future the global demand for talent is only likely to intensify further, we are already struggling to find enough good quality engineers, technicians, doctors, HR, marketing and even English teachers. The talent shortage may seem like a crisis to many of us, but like any crisis it’s also an also an opportunity. So for a change the government and the private sector need to be more imaginative about attracting, developing and retaining our best talent in Sri Lanka and abroad. In the final analysis talent has become the world’s most sought after commodity and a growing number of companies outside the tech industries from hedge funds to consulting run on brainpower, therefore a shortage of it could and will cause serious problems to any economy.