Talent Management in Emerging Markets: 1 Insight to Act On Today (Part 1)

This article is written by James Eyring

Increasingly, companies rely on Emerging Markets for revenue growth; this is particularly true given slow economic growth in the US, Europe and Japan. One of the greatest challenges to capturing growth in these markets is having the right leadership capability. Based on our on-going research on Talent Management in Emerging Markets and experience with companies, here is one insight into Emerging Markets that you can act on today.

One important aspect of talent management is in workforce planning. Many companies have talent management systems that are designed for slower rates of growth (e.g., 5-10%). However, revenue growth in emerging markets can easily hit 20-40% a year and new entrants to a market can easily experience more than 100% growth in a year. A small sales group of 10 people can grow to 60 very quickly. A company of 1000 employees can add 300-400 additional employees in a year.

Leaders in this environment are frequently outpaced by the growth of their own jobs. In addition, these leaders may face dramatically different challenges than leaders in a more mature market. These challenges include changing regulatory environments, government relations, talent supply shortages and infrastructure and supply chain challenges to name a few.

To build leadership, you must understand your future workforce needs to better:
1) Forecast numbers of leaders you will need in critical positions over the next few years
2) Hire ahead of the curve so that your leaders are ready to lead a much larger business over the next 2-3 years.

(c) 2010 Organisation Solutions Pte Ltd.

About the Authors: Dr. James Eyring is the chief operating officer of Organisation Solutions, a global consultancy specialising in organisational design, development and change solutions worldwide. James has more than 20 years of experience in the field of Organisational Development and his areas of expertise lie in large-scale organisation design and change, leadership development, and the design and management of distributed organisations.

Comments

[Richard Li]

The toght challenges are how organization ready for the dynamic situation, particularly from MNC perspective. Given the growth numbers of business and employees, how to rationalize "right" leadership capability. It is concventional thinking right leadership is proven track record like someone who did in mature market. That is absolutely a wrong mirror for many senior executives in this market. But it is normal thinking in many companies.

[James Eyring]

Richard, thanks for your comment. You are right, there are two problems with experience: (1) many leaders in emerging markets are promoted so quickly that they lack depth of experience and (2) many leaders in mature markets lack exposure to the high growth rates and complexities of emerging markets. Because of this, there is a large experience trade-off no matter the source of talent. I have a couple of thoughts on this. Some research on growth leadership indicates that you have to have the right leadership skills (transactional and transformational leadership) for leaders in these situations (no matter the experience level). This helps make up for lack of experience. Secondly, you need to ensure that you develop breadth and depth of experience in the long term