Do these descriptions fit your firm, or sound credible to you?
- "Managing talent in global organization is more complex and
demanding than it is in a national business." - "The movement of employees between countries is still surprisingly limited."
- "Many people tempted to relocate fear that doing so will
damage their career prospects." - "Yet companies that can satisfy their global talent needs
and overcome cultural and other silo-based barriers tend to outperform those
that don’t."
If so, welcome to the international "war for talent."
McKinsey has just
reported the results of a study involving in-depth interviews with executives
at 11 major global corporations and including the responses of senior managers
at 22 other global companies to an online survey (more than 450 people in
all), about how their firms deal with the multinational challenge of talent
management.
As much as we hear about globalization, and as cosmopolitan as we all like
to believe we are, "silo’s" are still far too much the order of the day. But
what’s important about the survey is not its utility as a snapshot of how multinational
corporations manage talent globally, but rather its insight into what differentiates
top performers from the also-rans. While the study’s authors are
quick to caution that their tools did not attempt to uncover evidence of true
causality, and note the absence of a longitudinal dimension, nevertheless there
are striking correlations between certain talent-management techniques and
financial performance.
But first, what’s holding companies back from managing their globally distributed
talent as one seamless, whole, asset? Attitudes like these:
- "Overseas experience is not taken seriously and not taken advantage of"
(senior manager). - "Much valuable experience dissipates [because my firm is in the habit
of] ignoring input from returnees, and many leave." - "People expect to be demoted after repatriation to their home location."
Difficult and uncomfortable as it may be to overcome these familiar ruts of
thinking, the hard and strong message of the study is, "Get past it."
To be specific, if financial performance is measured by profit per employee,
there is a very high correlation between companies that score in the top third
of the survey on ten dimensions of global talent management, and profitability. In
particular, companies scoring in the top third on any one of three critical
dimensions of talent management stood a 70% chance of achieving top-third financial
performance. The top three most important practices are: (a)
"ensuring global consistency in management processes;" (b) "achieving cultural
diversity in global setting;" and (c) "developing and managing global leaders."
The seven other talent management practices are less statistically compelling,
but a few notes about them nonetheless:
- "Translating HR information into action" is the fourth most important,
which if nothing else proves that it helps if you have the courage of
your convictions. - On the other hand, "shaping the corporate HR agenda for managing global
talent" has a mildly negative correlation with financial performance,
which should reassure the smug skeptics of HR’s ability to drive performance.
None of this should be especially shocking or hard to understand, but let’s
elaborate on it for a moment.
Why is consistency in talent evaluation across all geographic regions so important? Simply
because if mobility is to be a reality, managers need confidence that people
transferring into (or back to) their practice areas have met the same standards
their own stay-at-home stalwarts have. Steven
Davis, chairman of Dewey & LeBoeuf, said in a recent Bloomberg Radio interview
that the firm takes great pains to assure senior associates rotating abroad
that their chances for partnership will not be diminished.
If you believe
the McKinsey statistics, we can make an even stronger statement. Companies
that consistently differentiated themselves from their competitors excelled
at:
- Top management encouraging people to get experience across multiple locations;
- Regarding overseas experience as essentially a prerequisite for promotion
to senior-most levels; and - Offering managers incentives to "lose" their most talented employees to
other functions or geographies.
So as tempting as it may be to lie back in the cocoon of your departmental,
practice group, and geographic "silo," resist at all costs. Devote
serious senior management time to exploding those comfortable silos, and encouraging
(and rewarding) global mobility. And the best place to start is the most
common-sensical, the most powerful, and the most true to the tradition of honoring
each of your professionals as an individual with unique talents and capabilities:
Make
sure your performance evaluations hew to the same standards worldwide. Otherwise
the unspoken but irrepressible suspicion of the foreign will derail your fondest
hopes of achieving the "one-firm firm."
