Almost all human resources departments say the same thing – not only do they suffer from a deficit of talent, it’s a problem getting worse not better. But as we look to the future and assess the impact this will have on businesses, what does this concern really mean? At WCN, we believe it means something so acute and serious that without effective coping strategies, the simple fact is not all organisations will survive.
One key number starkly illustrates this; McKinsey estimates that by 2020 there will be a global deficit of 40 million university-educated people. So pronounced is this, we’re already seeing firms entering salary negotiations to ensure they get first-time job seekers. This is already the first sign firms are fighting for survival, but by making wages a larger proportion of costs, it’s not a sustainable solution.
We believe organisations do have the capacity to survive, but only if they adapt their strategies for finding talent
The only long-term option businesses have is to find answers as to why they can’t find the talent they want. We believe this will increasingly involve getting to talent faster and earlier, for instance forming partnerships with schools to create internships and work experience or by diversifying where firms get their talent from in the first place.
Between 2003 and 2013, Asia’s university population grew by 54 million, representing 74 per cent of the growth of global student numbers. India alone will add another nine million undergraduates to its student population by 2020. As a result, we now have clients shifting two-thirds of their recruitment to the Far East. But are enough other organisations doing the same to tap into this vital talent pool? Possibly not.
We believe organisations do have the capacity to survive, but only if they adapt their strategies for finding talent. For some human resources directors (HRDs) this might mean not taking university graduates at all, but using big data to redefine what good looks like in different roles and understanding where the best people in those roles come from. This is a move away from academic matching and more towards making other correlations. It’s only by understanding who succeeds and who is engaged that companies’ HRDs can redefine exactly who they’re looking for.
But there’s another area we believe needs confronting too – the need for organisations to make much more of emerging talent recruitment. Today, individuals with the scarce skills companies need make new connections earlier and earlier. If HRDs fail to track and make their own connections with these good people, they’ll lose the first bite of the recruitment cherry. It’s our future leaders who will take decisions about how to adapt and change their businesses, so getting to the best people to make these important choices has to be the future focus of HR.
Any solution must involve technology. Today relationships are digital and the best firms will create digital value propositions that talk not only to those they’re attracting to their talent pools, but to their existing staff too. HRDs must engage with talent at virtual events and even encourage existing staff to be brand advocates within their own networks.
Technology provides intelligence, hence it’s vital technology helps HRDs understand what potential is. So when HRDs need to sift through the hundreds of candidates they’ll get for each advertised role – more people will be chasing the same amount of jobs – they’ll at least know who they should devote the most time to during the selection process. Virtualisation technology – using video or psychometrics – can also help this and should be among the solutions adopted.
While the future is hard to predict, it’s fair to say that ultimately it will demand much more joined-up people-thinking. Firms that understand recruitment will know their success depends on creating relationships. Even when dealing with people they fail to hire, the best firms will realise they need to create some level of engagement, such as by giving feedback for next time. Why? Because who knows, one day, the candidate they once turned down could be just who they’re looking for a few years down the line.
Speed, accuracy and relationships, all underpinned by technology – they’re all needed now and they will all be needed even more in the future. If HRDs improve in all these areas, perhaps dire predictions of skills shortages ahead will not come to fruition. But the only way HRDs can avert this is by doing things differently – starting now.
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