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(Fourth of
five parts)
Today’s
companies face five critical business challenges:
globalization, technology, the quest for profitability
through growth, intellectual capital constraints and the
exigencies of continuous change. Regardless of their
industry, size or location, these challenges require these
organizations to continuously build new capabilities—a
responsibility which, University of Michigan School of
Business professor Dave Ulrich writes, human resources
(HR) should embrace for these organizations to last.
For
Philippine companies, these challenges are no less
important. The growth of the global economy, particularly
of the Asia-Pacific region, has vastly changed the
business landscape. As tariffs crumble and technology
blurs geographic lines, the Filipino enterprise now finds
itself as part of the global supply chain, competing with
businesses from all over the world. Slightly disadvantaged
in terms of capital and infrastructural support, Filipino
firms at least have that precious resource few other
countries have: human capital.
JOSE BALDERAMA,
Managing Director, Asia Select
This
resource, though, is slowly being depleted by the global
war for talent, intensified by the growth of economies
around the world and the growing recognition of the
Filipino worker’s skill and attitude. As a result, human
capital has become a perilously rare commodity in a
growing number of sectors, such as in engineering, IT,
education and the health sciences. And yet, in a sad
irony, unemployment remains at a constant high.
In the
global village, where knowledge has become the most
important currency, the truism about people being a
company’s source of competitive advantage rings truer than
ever. In the new economy, Ulrich writes, “Winning will
spring from organizational capabilities such as speed,
responsiveness, agility, learning capacity and employee
competence. Successful companies are those that are able
to quickly turn strategy into action; to manage processes
intelligently and efficiently; to maximize employee
contribution and commitment; and to create the conditions
for seamless change.”
All these,
of course, can only be done by having the right people in
place.
HR evolves
AT no
other time has the war for talent been as fierce. The
search for the right talent has become such an essential
function that it has forced the evolution of the HR
function.
“Whereas
HR used to be very traditional, generating systems and
procedures and focusing on administrative functions,
today, it is more strategic in nature,” notes Rey
Silvestre Canilao, vice chairman and managing director of
Global Executive Solutions Group, a human consulting
company servicing multinationals and global firms. It is
now oriented toward organizational development, straddling
such matters as succession planning, talent acquisition,
training and, recently, company culture, following the
flurry of mergers and acquisitions worldwide.
Indeed,
the HR function “has evolved. It is not just
service-related, but is more a partner of the CEO,”
Canilao adds.
For
today’s HR firms, it is thus imperative to understand
their clients’ businesses. “This is critical for us to
find the right talents for them,” explains Canilao. “We
ask: Are they strong in customer development,
distribution? Do they have inventory, IT problems? We have
to understand all that.”
CHICHO CHUAQUICO,
Director, ZMG Signium Ward Howell Global Executive
Solutions
In fact,
firms engaging in executive searches have ceased to see
themselves as HR practitioners, but rather, as human
capital-resource consultancies. “We are nontraditional; we
are businessmen, industry people who can offer a hands-on
business perspective,” Chico Chuaquico, director of ZMG
Signium Ward Howell Global Executive Solutions, says. “We
are in constant touch with industry leaders so we know
where the industry is going. We are more of analysts and
strategists and we understand the business of our
clients.”
The
business and its people are, after all, inseparable.
Companies are, of course, ever hungry for information and
insight that will help them arrive at the correct business
decisions that would inevitably influence who they should
get for their companies.
Complex
process
Research
underpins much of the consulting process. Executive
search, which Signium managing director Gigi Zulueta likes
to call “the highest form of management consultancy,” is a
human-capital solution that needs a good research
framework as its foundation.
Needless
to say, executive search is never a simple process. “It’s
really consulting and not an order-taking type of
business. You become a stakeholder somehow, especially
when you get the C-level executives. It’s an activity that
will give that firm competitive advantage, an answer to a
specific problem of the business,” Chuaquico says.
In fact, a
growing number of
US
private-equity, asset-management and direct-investment
firms are having head-hunters sit on their boards. For a
number of global companies, partnerships are sealed by the
promise of being able to get the right leaders.
Jose
Balderama, Asia Select managing director and Signium
director, recalls how Signium
India
helped effect vulture fund 3I’s acquisition of a
transformer-manufacturing firm. The buy-in proceeded when
3I was able to present the company’s skeptical chairman
with the right candidate to head the company.
REY CANILAO,
Managing Director, Global Executive Solutions
Access to
information has become a critical component of the
human-capital challenge. By providing important
information to large companies in search of a home for
their outsourced operations, Signium was able to bring
Chevron, Watson Wyatt and GSM (Baker & Mackenzie) into the
Philippines and helped build up their businesses from the
ground.
For
Balderama, this meant “telling them what to expect” in
very specific terms. Time and again, he has found himself
advising clients on their wish list of competencies to
include what is most critical and dispense with what may
be whimsical. “You can really just focus on a number of
competencies since the search strategy is dependent on
what the talent market can bear,” he explains.
A shared
services firm, for instance, wanted candidates with at
least five years of experience even when they were the
first in the Philippine market. Another wanted
SAP-literate professionals with 10 years of experience in
the software even when SAP has not been around that long
in the country. A third wanted statisticians with
psychology backgrounds. “This is when the value of the
firm comes in,” he says. “We tell them what to look for,
help them temper their expectations to what’s available in
the market and tell them when the people they want don’t
exist. We don’t sugar-coat.”
Search the
world
This is
not to say that Signium does not exhaust its resources in
scouring the world for the best possible talent.
Just as
the world’s poachers get their talents from the
Philippines, so does Signium consider the globe as its
hunting ground. It scours the world to keep tabs on
Filipino professionals and diligently conducts “road
shows” in Singapore and the United States to know who
these people are. Chuaquico recalls how the realization
that telecommunications will evolve from a utility to a
consumer product sparked the search for the next head of a
large telecommunications company, a search that Signium
ended in Singapore.
When a
semiconductors company realized it was losing out to
manufacturers in cheaper Asian locations, it knew it
needed a new leader to bring it out of the woods. The
company wanted a man who knew three languages, had managed
a million-dollar organization, had a business development
orientation, and was a Filipino. Signium found their man
in the US Midwest, and though negotiations stretched for
half a year, the leader has since taken the company public
in Singapore and has dramatically increased shareholder
value. “The easiest searches,” notes Balderama, “have a
few qualified people.”
Beyond
competencies, leadership counts for a lot. “We believe in
identifying leaders,” says Canilao. “A company may have
the products, the business processes and everything else,
but most important are its people. The real competitive
advantage will come from leadership—the capability to
manage people, to rally people.”
The right
attitude, a willingness to learn and the capacity to
adjust are qualities of leaders who can bring successful
companies to the next level.
For Global
Executive, thus, it is especially important to not just
have the best talent but the “fit” as well. “The chemistry
and the culture is a big factor,” Canilao points out.
Personality, too, counts for a lot. Moving talents from
multinationals to local conglomerates, for instance, may
present problems for both the company and the talent due
to cultural differences. He notes, though, that local
conglomerates are professionalizing their ranks and are
adopting global processes such that large Filipino
companies such as Unilab, Jollibee and Smart are hiring
from multinationals with success.
“At the
end of the day,” he says, “you will need to understand the
culture of the client: their vision and mission, their
business landscape, their leadership style, their
management style.”
Tech helps
Understandably, the war for talent is an expensive one.
“We don’t have a fixed mindset on costs,” says Signium’s
Chuaquico, adding that the company doesn’t mind paying for
calls made all over the world.
“We’re
building our research. These calls will generate a lot
more,” he reasons. “We’re the only one with the enterprise
approach. We spend time, which is very expensive. We don’t
think of the short term, it’s always the long term for
us.”
Fortunately, information technology has brought about the
“death of distance.” With information technology, “we’re
on real time, so we move faster,” says Chuaquico.
Videoconferencing facilities, 3G broadband and
Blackberries have speeded up the search process. “We
realize that clients are always on a timeline. We’ve
always believed project managers will rule the world, and
we keep up with the pace of managers,” he says. This, adds
Canilao, is particularly important when one is serving
clients overseas.
As the war
to attract and retain talent rages, companies are coming
up with innovative ways to stand up to the human-capital
challenge. Signium, for instance, is organizing trade
missions to Vietnam, knowing that any partnerships forged
or businesses consummated would trigger a need for
human-capital solutions. It is also working in
collaboration with the Commission on Higher Education, the
Ateneo de Manila University and the University of Asia and
the Pacific so that the academe may produce the
competencies that the job market so urgently needs. On his
own, Chuaquico finds time to help La Salle high-school
juniors and seniors plot their future careers.
Beyond
salaries
Across all
levels, talent searches have become more creative. Many
companies are working closely with third parties to help
shore up their manpower needs. ICTSI, for instance, has
partnered with equipment operator Monark to train
high-school students for a year and eventually hires those
who successfully complete the training program. There,
too, are the usual school job fairs held all over the
country in malls, plazas and government halls.
Call
centers are known to hold concerts and host open houses
everywhere, from parks to coffee shops, to hunt for the
people they need. One call center, People Support, even
put up recruitment kiosks in malls. Others pay referral
fees ranging from P5,000 per applicant plus an additional
P2,000 when the applicant hurdles the training program.
Accenture talent acquisition specialist Christa Perez says
such promotions are necessary to fill up shortfalls in
demand. Sometimes, they would have to fill up as many as
1,000 slots in one day.
Of course,
compensation packages are also being enhanced. “You have
to be innovative,” said Stella Garcia, office practice
leader of the Human Capital Group of Watson Wyatt. Cash
and benefits, for instance, are not the only carrots to
dangle to talents. Rather, there is a greater emphasis
toward a more “holistic” employment deal that gives weight
to work/life balance, career breaks and training
opportunities. Being able to work from home or being
mobile appeals to workers who want to be free from the
encumbrances of work.
More
important, people need to have a personal stake in the
enterprises they work for. Willy Arcilla, regional
director of ZMG Signium Ward Howell and president of
Market Mentor, believes in the merits of power sharing.
“The worker who is a part-owner is more productive. He
will take the initiative to drive revenues and reduce
costs—even without being told by his superior,” said
Arcilla.
Need is
indeed the mother of innovation. As the global war for
talent intensifies, so will organizations find new ways to
meet the human-capital challenge. “If people are a
company’s greatest asset, then providing human-capital
solutions is the best industry with the highest ROI—both
financially and personally—especially if the supply of the
best talent is in constant shortage globally,” Arcilla
said.
Through
all this, the challenge for HR, as enunciated by Dr.
Ulrich, is not just to become a “partner in strategy
execution, helping to move planning from the conference
room to the marketplace,” but also “to become an agent of
continuous transformation, shaping processes and a culture
that together improve an organization’s capacity for
change.”
(To be
continued) |
