Understanding the “War for Talent”
The business landscape is evolving. Traditionally, companies competed by securing capital, developing products, and defending their market share. However, the source of competitiveness is now shifting towards human capital, which is increasingly recognised as an intangible asset of the enterprise. Human capital encompasses the processes that create, organise, and manage talent—essentially, the people who drive the business forward by creating products, defining margins, and raising capital.
The responsibility for managing human capital is shared between company leaders and HR professionals, underscoring the need for a global management approach and a suitable leadership style. According to the Chartered Institute of Personnel and Development (2006), evolving labour market demographics, resource scarcity, and the demand for work-life balance have contributed to what is termed the “War for Talent.” As a result, HR managers face significant challenges in attracting, motivating, and retaining top employees amidst a limited and diminishing pool of skilled workers.
Practical Challenges in Attracting Top Talent
Beyond the theoretical framework, several practical reasons may hinder your ability to attract the best talent:
· Nature of the Enterprise: Family-owned businesses, for example, may struggle to attract high-profile employees and might have to hire from a sub-optimal talent pool.
· Personal Life Choices: Talented individuals often have numerous options and may leave for personal reasons, such as wanting to live in a different country or spending more time with family. They are unlikely to sacrifice their life choices for work because they know their value and believe they can find opportunities that align with their personal lives.
· Organisational Values: If your company has ethical issues, contributes to environmental pollution, or is involved in unethical practices like child exploitation, it may deter talented individuals from joining.
· Lack of Clarity and Equity: A lack of clear career paths and equity within the company can also dissuade talented people from joining.
· Social Responsibility: If your company does not contribute to the betterment of the community, potential employees might not view it as a socially responsible organisation.
These are just a few examples, and there may be many other factors at play.
Self-Assessment for Improvement
When you notice talented individuals hesitant to join your company, it may be helpful to conduct a self-assessment to understand what practices might be deterring them. Evaluate your company’s culture, values, and policies to identify areas for improvement.
Context-Specific Considerations
In some countries, especially where business success heavily depends on the owner’s relationships with people in power, many of the above factors might not apply.
In conclusion, the “War for Talent” requires a strategic and holistic approach to human capital management. By understanding and addressing the factors that influence talent attraction and retention, you can build a highly productive team that drives your company’s success.
Dr. Youssef Lamaa
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