a minimum of four paragraphs and should be a minimum of 400 and 450 words. The font is Times New Roman, font size should be 12, and the paragraphs are single-spaced. There should be a minimum of three references supporting your observations. Citations and references are to follow APA 7.0.
The executive who ignited the transformations from good to great did not first figure out where to drive the bus and the get people to take it there. No, they first got the right people on the bus (and the wrong people off the bus) and then figured out where to drive it (Collins, 2001).
Read the article "Talent Management Decision Making" and compare one of the author's concepts to that of Jim Collins.
Your response should be a minimum of four paragraphs and should be a minimum of 400 and 450 words. The font is Times New Roman, font size should be 12, and the paragraphs are single-spaced. There should be a minimum of three references supporting your observations. Citations and references are to follow APA 7.0.
Collins, J. C. (2001). Good to great: Why some companies make the leap … and others don't. New York, NY: HarperBusiness.
Link – https://www.youtube.com/watch?v=Jg62oeEzMkU
Talent management decision making Vlad Vaiman
School of Business, Reykjavik University, Reykjavik, Iceland
Hugh Scullion J.E. Cairnes School of Business and Economics, NUI Galway, Galway, Ireland, and
David Collings Dublin City University Business School, Dublin City University, Dublin, Ireland
Purpose – The paper sets out to understand the key issues that emerge in the context of decision making.
Design/methodology/approach – The paper is a literature review.
Findings – First, the authors review debates around talent management decision making. Second, they examine some of the main factors currently influencing decision making in talent management. Third, they seek to identify some future research areas that will inform future decision making in talent management.
Practical implications – The paper will be of interest to practitioners in designing and developing talent management decision systems.
Originality/value – The paper presents a state of the art review of talent management decision marking.
Keywords Talent management, Decision making, Global talent, Human resource management, Employees
Paper type Research paper
1. Introduction In today’s rapidly moving, dynamic, uncertain and highly competitive global market, firms worldwide are facing major decisions and challenges in global talent management (Schuler et al., 2011; Scullion et al., 2010; Tarique and Schuler, 2010). For organizations across the globe, talent management of knowledge workers and high potentials is of increasing strategic importance (Tymon et al., 2010; Vaiman, 2010). Indeed, there has been growing interest in talent management among senior managers and academics alike since the late 1990s when McKinsey consultants coined the phrase “the war for talent” to underscore the key role of leaders and high potentials played in the success of leading companies (Boudreau and Ramstad, 2007; PricewaterhouseCoopers, 2008a; Scullion et al., 2010; McDonnell, 2011; Scullion and Collings, 2011). A recent report by the Boston Consulting Group highlighted talent management as one of five key challenges facing the HR profession in the European context and, interestingly, that it was also one of the areas which the function was least competent in (Boston Consulting Group, 2007).
It is important to note that there is considerable debate between researchers with respect to their understanding of the meaning of talent management. Some researchers see talent management from a primarily human capital perspective (Cappelli, 2008)
The current issue and full text archive of this journal is available at
Management Decision Vol. 50 No. 5, 2012
pp. 925-941 q Emerald Group Publishing Limited
0025-1747 DOI 10.1108/00251741211227663
while others see it as essentially a mindset with talent as the key to organizational success. Others see the alignment of talent management closely to the business strategy and the corporate culture as a key feature of talent management (Farndale et al., 2010; Kim and Scullion, 2011). Recent reviews have concluded that the lack of precise definitions of talent management may have contributed to our limited understanding of the area (Mellahi and Collings, 2010; Collings and Scullion, 2009).
While talent management has been criticized for lacking conceptual and intellectual foundation, and still faces some difficult issues around its definition and intellectual boundaries (Lewis and Heckman, 2006; Scullion and Collings, 2011), some recent work has addressed this issue and has contributed theoretically to the study of talent management (Boudreau and Ramstad, 2007; Cappelli, 2008; Vance and Vaiman, 2008; Vaiman and Vance, 2008; Collings and Mellahi, 2009; Becker et al., 2009; Farndale et al., 2010; Groysberg, 2010; Lengnick-Hall and Andrade, 2008; McDonnell et al., 2010; Scullion et al., 2010; Tarique and Schuler, 2010; McDonnell, 2011; Asag-Gau and van Dierendonck, 2011; Bethke-Langenegger et al., 2011).
As the field of talent management develops to a more mature stage over the coming years, emergence of greater consensus around its definition and intellectual boundaries will be an important measure of progress (Collings et al., 2011). However, it is equally important not to loose sight of differences in how talent management is defined and conducted in different national contexts. This comparative understanding will be equally important as the field matures. Such an understanding should help to counteract an overly ethnocentric or Anglo-Saxon conceptualization of talent management which is not reflective of practice in many parts of the world (Luthans et al., 2006; Vance and Vaiman, 2008; Mellahi and Collings, 2010; Tymon et al., 2010; Scullion and Collings, 2011).
While a thorough debate on the variations in definitions is beyond the scope of the current paper, for the objectives of this paper, we propose Scullion and Collings (2011) definition of global talent management:Global talent management includes all organizational activities for the purpose of attracting, selecting, developing, and retaining the best employees in the most strategic roles (those roles necessary to achieve organizational strategic priorities) on a global scale. Global talent management takes into account the differences in both organizations’ global strategic priorities as well as the differences across national contexts for how talent should be managed in the countries where they operate.The empirical evidence on talent management remains limited but does point to wide differences between the rhetoric of formal policies and the reality of what happens in practice. While firms tend to recognise the importance of talent management, they often fail to manage it effectively (Scullion et al., 2007; Schuler et al., 2011; Collings et al., 2011). The global financial crisis has led to questions on the continued relevance of traditional approaches to talent management, but evidence suggests that it remains a rather significant issue for senior managers in many large organizations. For some companies, identifying, attracting and retaining talented, high value employees has actually increased in importance in recent years (Beechler and Woodward, 2009; Farndale et al., 2010; McDonnell et al., 2010; Scullion et al., 2011).
Talent management is likely to be a challenge for organizations in all the major economies right across the world, with recent research suggesting that talent management challenges may even be more acute in the emerging markets (Yeung et al.,
2008; Tymon et al., 2010; Vaiman and Holden, 2011). Yet, there is a dearth of empirical research on talent management in the emerging markets, notwithstanding some recent contributions on India and China, reflecting the growing strategic importance of these markets (e.g. Teagarden et al., 2008; Illes et al., 2010).
Decision making in talent management increasingly needs to recognize that the context in which people management takes place in different parts of the globe, including the emerging markets, is significantly different to the US context where much of the theory around talent management has emerged (Brewster, 1995; Brewster et al., 2004; Holt Larsen and Mayrhofer, 2006; Dickmann et al., 2008).
This article has three main aims. First, it seeks to review debates around talent management decision making. Second, it examines some of the main factors currently influencing decision making in talent management. Third, it seeks to identify some future research areas which will inform future decision making in talent management.
2. The linkage between talent management and management decisions The linkage between talent management and management decision making is not new. John Boudreau began using the term decision science in the context of talent management and HR in the late 1990s (Boudreau and Ramstad, 2007). Boudreau and Ramstad (2007, p. 25) defined the goal of talentship decision science as “to increase the success of the organization by improving decisions that depend on or impact talent resources”. Essentially, they argue that HR must reposition itself as a function and shift the emphasis from the provision of services to supporting key decisions within the business, particularly in relation to talent. In much the same way as marketing and finance have evolved to become functions which very much inform and support decision making by organizational leaders beyond their functions, Boudreau and Ramstad argue that HR offers far great potential if it focuses on providing non-HR leaders who ultimately make talent decisions with the decision framework and data and analysis required to inform key decision around talent. However, even a cursory examination of organizations suggests that decisions around talent are often made without well-understood frameworks or consideration of the key relevant data (Boudreau, 2010). Instincts and informed preferences and biases of key stakeholders often unduly bias talent decisions (Mellahi and Collings, 2010; Boudreau and Jesuthasan, 2011).
Moving beyond the limited role which the HR function has historically played in key talent decisions involves moving beyond the provision of data requested by organizational leaders towards bringing synthesis to the data, presenting them in usable metrics and analytics, and explaining the nuances behind them (Boudreau and Jesuthasan, 2011). This is important as information overload where managers have too much data are far more common than a lack of data. When this is considered in the context of bounded rationality, where the cognitive limits which individuals experience in their ability to process and interpret large volumes of complex information often results in poor decisions (Simon, 1979). In coping with their limited ability to process such complex and incomplete information, managers often make decisions based on a subset of the information available, often leading to biases in decision making (March and Shapira, 1987; Bukszar and Connolly, 1988; Hammond et al., 1998). The idea of bounded rationality has been applied to decision making in global talent management (Mellahi and Collings, 2010; Makela et al., 2010). The implications of framing talent
decisions around this include questions about the extent to which decision makers search for pertinent information to guide their decision making and satisfying in terms of the level of information required before managers feel they can make a decision and stop the process of gathering information (Simon, 1979). In practice it is unlikely that managers faced with global talent management decisions will have the time or the capability to scrutinise all possible candidates from all subsidiaries who fit the criteria (Mellahi and Collings, 2010). It has been argued that in such situations decision makers are likely to select candidates closer to them – who are considered good enough – based on previous experience and predispositions and biases. As Makela et al. (2010) point out, talent decisions are often made on the basis of cognition-based choice processes, in which boundedly rational decision makers evaluate available performance data and anticipations of future potential.
In his contributions over the past decade or so Boudreau has attempted to move the nature of talent decisions beyond such imprecise and bounded frameworks to decisions supported by scientific data and processes. The aim is to improve decision makers’ ability to make informed decisions around human capital and talent management. More recent contributions point to evidence of the increasing adoption of sophisticated methods of analyzing employee data in pursuit of competitive advantage (Davenport et al., 2010b). Indeed, Davenport et al. (2010b) have developed a useful typology of analytics which represents the different uses organizations can make of talent analytics. These range from simple human-capital facts which include individual level performance data and enterprise level data such as head-count, turnover and recruitment metrics to sophisticated real-time deployment of talent based on quickly changing needs. However, the potential of analytics in understanding which actions have the greatest impact on business performance is also an important category in their typology which some could argue is the most significant. Understanding the impact of key roles or “pivotal talent segments” and optimising investments in human capital are central aspects of maximising the efficiency of decisions around talent management (Becker et al., 2009; Collings and Mellahi, 2009; Boudreau and Jesuthasan, 2011). All in all the effective use of analytics (Davenport et al., 2010a) and proven business tools (Boudreau, 2010; Boudreau and Jesuthasan, 2011) in making talent decisions are reflective of the shift towards evidence based management (Rousseau and Barends, 2011) and represent an important step in maximizing the contribution of the HR function to organizational decision making and performance.
In the following we consider some specific factors which add to the complexity of decision making in talent management in the global context.
3. The key factors influencing talent management decision making in the global context As we have outlined previously, the framing of talent decisions in appropriate frameworks and maximising the use of appropriate data in the decision process have received increasing attention over recent years. Decision making around global talent management has emerged as a key challenge for multinational enterprises (MNEs) in the last decade (Scullion and Collings, 2011). We identify a number of factors which have impacted on this complexity.
Talent shortages First, there is a growing recognition of the critical role played by international talent management in ensuring the success of MNEs (Scullion and Starkey, 2000; Black et al., 2000). This reflects the intensification of global competition and the greater need for international learning and innovation in MNEs (Bartlett and Ghoshal, 1989). Indeed, the effective management of human resources, and particularly the quality of leadership talent in the MNE are increasingly seen as major influences on the success or failure in international business (Black et al., 2000; Scullion and Starkey, 2000; Collings et al., 2007). Shortages of international management and professional talent have emerged as a key HR challenge facing many MNEs that are competing for the same global talent pool and facing difficulties in recruiting and retaining the managerial talent required to run their global operations (Tarique and Schuler, 2010).
Research highlights that a shortage of leadership talent is a major obstacle that many companies face as they seek to operate on a global scale (Scullion and Starkey, 2000; Stahl et al., 2007; Cappelli, 2008; Briscoe et al., 2009). This literature suggests that management decision making in the area of global leadership is a critical area for global talent management, and that decision making in this area needs to be strategic and effective in order for MNEs to successfully implement their global strategies (Scullion, 1994; Scullion and Brewster, 2001; Cohn et al., 2005; Ready and Conger, 2007; Stahl et al., 2007; Björkman and Lervik, 2007; Farndale et al., 2010).
There is growing recognition that MNEs need to manage talent on a global basis to remain competitive, reflecting the trend that competition between employers for talent has shifted from the country level to the regional and global levels, and that talent may be located in different parts of the global network (Sparrow et al., 2004; Farndale et al., 2010). On the supply side, a number of factors have increased the level of international mobility and opportunity for new forms of mobility, such as the volume of migration and the shift towards skills-related immigration systems; the globalization of a number of professional labour markets such as healthcare and information technology is also significant in this respect (Sparrow et al., 2004; Solimano, 2010). On the demand side, there has been an increase in demand for expatriates with the capability to develop new markets, and there is a growing demand for alternative forms of international assignments such as short term assignments, commuter assignments and the like (Collings et al., 2007; Farndale et al., 2010).
Further, the importance of talent management decision making is no longer confined to large MNEs or large domestic organizations. Research suggests that talent management issues are becoming increasingly more significant than previously due to the rapid internationalization of small and medium-sized enterprises and the emergence of “micro multinationals” in recent years (Scullion and Brewster, 2001).
Demographics and societal trends Second, declining birth rates and increasing longevity are key demographic trends which increasingly impact the nature of the talent management decision making and the nature of talent management challenges facing organizations (Taylor and Napier, 2005; Beechler and Woodward, 2009). Research has highlighted rapid shifts in the demographic profiles of many countries which impact on the supply of labour available to employers in those countries, and this requires many organizations to introduce new approaches in their recruitment and retention policies and practices
(Tarique and Schuler, 2010). There are a number of specific demographic trends likely to influence talent management decision making, for instance, in Europe in the next decade.
A major survey on HR trends in Europe identified managing demographics as one of the key challenges facing the HR function (Boston Consulting Group, 2007). A significant problem was the loss of capacity and knowledge, as workers retire in increasing numbers. Another key problem is the aging of the workforce. These trends are reinforced by a recent study which highlights the implications of the retirement of baby boomers in terms of talent gaps in key economies around the globe (World Economic Forum, 2011). The study suggests that in Western Europe the talent supply will decline continuously, leading to “almost empty talent pipelines beyond 2020” (World Economic Forum, 2011). The analysis suggests that in the UK and Germany immigration and growth rates will not be enough to offset the reduction in the workforce resulting from the aging population. The study also highlights that talent shortages are expected to be major issues in Spain and Germany for the next 20 years (World Economic Forum, 2011), and that the challenges for managing the labour force in Poland and Russia are also considerable (Ward, 2011).
The nature of talent management decision making will also be influenced by the increased significance of the so-called Millennials (i.e. those who entered the workforce since the turn of the present century) which has emerged as a significant demographic trend in recent years The Millennials are an employee group who are likely to be in high demand given the demographic trends identified previously, and a recent report suggests that they have rather different expectations in terms of the psychological contract at work (PricewaterhouseCoopers, 2008b). They place a strong emphasis on corporate social responsibility and highly value training and development. They also have a preference for mobility at an early stage in their careers. Millennials also have strong expectations that they will change organizations a number of times during their careers (PricewaterhouseCoopers, 2008b) which reflects the characteristics of boundaryless careers (Arthur and Rousseau, 1996). Senior managers making the key strategic decisions in talent management will increasingly need to better understand the role of employer branding in attracting and retaining this employee group. Also, they will need to develop a greater understanding of the issues affecting the motivation and engagement of this cohort, and its emergence will involve greater complexity of decision making in talent management (Pate and Scullion, 2010).
Corporate social responsibility Third, recent research suggests that increasingly many companies need to consider Corporate Social Responsibility (CSR) as an important element of their approach to decision making in talent management. Many companies see CSR as a key part of their recruitment and retention strategy and regard CSR as a useful tool to attract high-quality international talent. In addition, research suggests that contemporary workers do not select a workplace only for money, particularly in dynamic and fast moving markets (Summer, 2005; Tymon et al., 2010). Cultivating a reputation as a socially responsible company can be an important lever in talent management and retention. Managers can use CSR to enhance employee sense of intrinsic rewards rather than becoming too dependent on increasing compensation or benefits. This helps organizations to develop an employee value proposition that is more difficult for
competitors to copy compared to an alternative of offering higher compensation (Bhattacharaya et al., 2008; Tymon et al., 2010). Once an employee is motivated by a firm’s CSR efforts, the employer might experience lower staff turnover rates (Redington, 2005), and research suggests that employees place a lot of emphasis on the quality of their relationships within the organization: trust, pride, fun and development are increasingly important to motivate and retain key staff (Levering and Moskowitz, 1983/1984).
We should not forget, however, that national context plays an enormous role in defining the relationship between CSR and people management. Recent research by Kim and Scullion (2011) highlights that not only there are very different conceptions of CSR in different countries, but also there are very different ideas about the links between CSR and global talent management in different national contexts, which reflects that people are motivated for different reasons in different institutional settings. Their study of the link between CSR and talent management in a comparative context showed that the current state of knowledge exploring the links between CSR and talent management were rather limited, and their research highlighted how its practice may vary in different national contexts. Their empirical study demonstrates a marked contrast in the approach of CSR towards talent management strategy between Asian and western countries, and suggested that key decision makers in talent management need to take account of cultural and institutional differences between countries. The research highlighted the large divergence in CSR-HRM relationships in different national contexts despite the strong pressures for convergence due to globalization, isomorphism, and standardization of CSR. Future research should pay more attention to the relationship between CSR and people management in different national contexts, as to date the bulk of research on CSR has focussed on companies using the Anglo-American corporate system (Kim and Scullion, 2011).
Diversity Fourth, the challenge of managing diverse employee groups in a globalized environment (Briscoe et al., 2009) is emerging as a significant factor impacting the complexity of decision making in global talent management, as the level of diversity within organizations is increasing (Beechler and Woodward, 2009). Gender diversity is also on the rise, as reflected in growing female labour force participation rates across the globe, yet women continue to be seriously underrepresented in senior management positions and in international management ( Jacobs, 2005; International Labour Organization, 2009; Linehan and Scullion, 2008). Recent research also suggests that the level of ethnic, cultural and generational diversity of staff working in organizations across the world is on the rise as well, which has a strong influence on the way the employees are managed and decisions are made (Briscoe et al., 2009; Beechler and Woodward, 2009; Scullion and Collings, 2011).
The increasing mobility Fifth, the increasing mobility of people across geographical and cultural boundaries progressively impacts on decision making in global talent management (Tung and Lazarova, 2007; Vance et al., 2009). The trend towards greater mobility and emigration rates are higher among professionals and high skilled workers; however, reverse migration is also becoming more significant in recent years with many countries
seeking to encourage returnee immigrants due to the growing recognition of the potential benefits of their international management experience and networks in the home country (Carr et al., 2005; Tung and Lazarova, 2006; Tung and Lazarova, 2007; International Labour Organization, 2009; Solimano, 2010). In addition, researchers have highlighted a trend where people with special talents show little loyalty to country or region and are very comfortable crossing cultural and geographical boundaries. This new global elite have been described as “cosmopolitans” (Kanter, 1995), and it has been argued that this trend results in a “talent divide” with a growing number of talents spanning national borders, and at the same time, a large pool of people who have few opportunities for international mobility due to lack of access to education and career opportunities (Taylor and Napier, 2005; Baruch and Dickmann, 2011).
Permanent shift to a knowledge based economy The move to knowledge based economies is a further factor impacting on decision making in global talent management. The rapid growth of the service sector in developed economies results in a growing need by companies to hire high-value workers in more complex roles which requires higher levels of cognitive ability (Chartered Institute of Personnel and Development, 2007), and this trend reflects the shift towards intangible and human assets (International Labour Organization, 2009). Key decision makers in many large organizations and MNEs are increasingly concerned with the retention and motivation of these knowledge workers, which has emerged as a key talent management challenge for many organizations ( Johnson et al., 2005; Beechler and Woodward, 2009; Vaiman, 2010; Sparrow, 2012). However, the current global recession characterized by corporate downsizing has resulted in professional managers increasingly trading security for flexibility and becoming less dependent on a single employer. Some have argued that the traditional psychological contract based on loyalty, commitment and accountability in return for job security is currently being replaced with one where employees increasingly take responsibility for their own employability and career development (Pink, 2001; Sparrow et al., 2004; Pate and Scullion, 2010; Farndale et al., 2010; Cappellen and Janssens, 2010; Baruch and Dickmann, 2011).
Recent research suggests there has been a growth of a wide range of international assignment options over the last decade ranging from the traditional expatriate assignment to the growing number of more flexible global staffing arrangements such as short term assignments, international commuter assignments, virtual teams and others (Collings et al., 2007; Mayrhofer et al., 2012). While researchers have highlighted the absence of empirical data about the utilization of alternative forms of assignment (Mayrhofer et al., 2008), it can be argued that rapid changes in the global competitive environment mean that more flexible forms of global staffing will be progressively used as alternatives to traditional expatriate assignments (Collings et al., 2007; Mayrhofer et al., 2012). Therefore, key decisions on global talent management will increasingly need to consider the emergence of more flexible forms of international staffing as well as the traditional forms of international assignment.
Growing importance of emerging markets Finally, the growth of the emerging markets has a major impact on decision making in talent management. Organizations are seeking managers with distinctive competencies and a desire to manage in culturally complex and geographically distant countries (Li and Scullion, 2006; Björkman and Lervik, 2007; Scullion et al., 2007; Li and Scullion, 2010; Farndale et al., 2010). In the current climate with high unemployment in many countries, it may no longer be appropriate to talk about a “war” for talent (Farndale et al., 2010). However, more people on the labour market does not necessarily mean that employers are able to find the level of skilled managers and professionals that they are seeking. The evidence suggests the demand for talent remains high, and that there is still a scarcity of high-level knowledge talent in the emerging markets. Also the evidence suggests that there is strong competition between MNEs and local players for the available talent (Teagarden et al., 2008; Li and Scullion, 2010).
The retention of knowledge workers and managers in the emerging markets has materialized as a major challenge for MNEs with annual turnover rates in key sectors much higher than found in the West (Bhatnagar, 2007). For example, in India and China problems in producing graduates in the numbers and quality needed by multinational companies has resulted in acute skill shortages in key areas (Farrell and Grant, 2007; Farndale et al., 2010; Li and Scullion, 2010; Tymon et al., 2010). In …
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