By Andrew Laurence
Chairman & CEO Europe, Middle East & Africa (EMEA)
Hill & Knowlton

By Ruth Pestana
Director of Strategic Services
Hill & Knowlton USA

Andrew Laurence and Ruth Pestana address the challenges in attracting a mobile pool of global talent.

In conversations we’ve had with senior business executives over recent years, one consistent theme has emerged: how can we recruit and retain the best talent?

As the world economy globalises, so does our talent. To be a world leader it is not good enough just to employ the best people in your home market - you need the best people in every market. That pool of superior talent is limited and is one of the factors driving sharp increases in senior executive pay.

This war for talent also exists beyond the executive suite; its scarcity is moving right down the chain of command. We recently surveyed more than 500 MBA students from some of the world’s leading business schools - a talent pool likely to include some of the next generation of corporate leaders.

So what does ‘generation 2025’ want? They want to get to the top: 84% were very or fairly interested in becoming a CEO or CFO one day.

With the target set high, how do they intend to get there and which countries and markets will win the talent war?

Global reputation
When searching for their new career, 20% of students surveyed want to move to another country from the one they studied in. A further 25% are studying outside their home country and plan to remain there post-MBA. European students are somewhat keener to move to another country other than where they studied, with 28% of students supporting this option, compared to 15% of North Americans and 10% of Asians.

Geographically, regional reputations can also be detractors. While many have argued that the geographic balance of the world economy and the world’s financial markets is decisively shifting from West to East and from North to South, perceptions of reputation are not moving in the same way. It remains the case that students believe that Western European and North American firms manage their corporate reputation much better than those in the rest of the world.

Conversely, a knowledge vacuum about companies in the emerging markets of Eastern Europe, Latin America and the Middle East prevented half of our respondents from taking a view.

This lack of knowledge translates fairly directly into views on possible regional locations post-MBA. The most attractive regions by far remain the developed markets of Western Europe and North America. These regions gained a net interest score (those interested minus those not interested in working in the region) of 80% and 76% respectively.

However, some regions have negative net scores: Latin America -8%, South Asia -19%, Middle East -37%, Russia -41%, Eastern Europe (not including Russia) -36% and Africa -49%.

There are some variations to the rule. European students are somewhat more interested than others in working in the Middle East and Eastern Europe; and Asian students that we surveyed are more interested in working in North and South East Asia, which reflects the China opportunity combined with their predominantly Chinese heritage.

A great deal has been made of the rise of the BRIC economies and other emerging markets, such as the N11. When it comes to specific emerging markets, it is clear that China, Singapore and Brazil are the winners in this battle of preference. Among students from the US and European programs, China, Singapore and Brazil ranked similarly, though among the students from Hong Kong and China, Brazil fared less well, as did India. Students at European schools are somewhat more attracted by the UAE than students at US or Asian schools.

Paycheck versus reputation
When asked what factors would influence career and job choice, a clear tiering system emerges. The top tier is about people and position. The second tier includes basic issues about corporate performance and the third covers the messages that a company communicates about its broader brand and values agenda – messages about activities which fall under the umbrella term Corporate Social Responsibility (CSR), such as ethics, community involvement and environmental responsibility.

This shows that the best candidates are thinking about more than just paychecks when deciding on job offers. The employee experience matters deeply. Recruiters of top talent will need to offer more than just generous compensation and opportunity. The leaders of tomorrow are overwhelmingly seeking to associate themselves with industries, countries and companies, with great reputations.

How can the war for talent be won?
Whilst the emerging markets may have got their economic pitch right, they are, in many cases, failing to attract the very talent that can help their markets move to the next level.

The business world in an emerging market can offer a fast-moving, exciting career with endless opportunities to be ‘thrown in the deep end’ and progress quickly up the career ladder. So there is no reason why these markets shouldn’t be attracting top talent, they are just failing to communicate the opportunities effectively.

Those markets with inferior reputations will find it very difficult to attract talent without paying a premium. And an economic slowdown will not change the intensity of this fight. The reality is that the best talent, like the most attractive real estate, will always be in scarce supply and the future winners in the corporate world will be the ones who are the quickest to recognise this.

The most successful companies will recognize their strengths and weaknesses and work to address the latter. They will benchmark their CSR programs against their competitors, and how the policies are being communicated internally. And they will actively monitor, and work to promote, their external corporate reputation in areas where they hope to recruit.

In order to attract and retain the best and the brightest talent, the answer in the short term may have be much better offers of pay and benefits. Longer term however, the success stories in the global war for talent will be those businesses and governments that seize the opportunity to work together to communicate these opportunities and build a stronger destination brand.