Talent Management in Emerging Markets: 1 Insight to Act on Today (Part 6: Segment!)

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.

Segment your Markets!

Many MNCs design one-size-fits-all talent management practices. Markets may have input in the design process, but a standard, single process to be used is typically the result.

As other articles in this series point out, this does not always result in the best outcome for the company. This begs the question: How can companies design talent processes differently and still maintain economies of scale?

One potential solution is to better segment your markets.

Market size is a common approach used to segment markets. We looked at this in our research on talent management practices. In comparing practices by market size, there were a few interesting differences between markets of small and large revenue and headcount, but not many. For example, companies with lower revenue (under $500M) tended to be more flexible in their practice implementation; potentially because they were implementing these programmes “under the radar” while larger countries received more attention.

Instead, we found the largest practice differences by market growth rate. Regardless of revenue size, companies with higher growth rates tended to implement more talent management practices, especially in the areas of Selection and Staffing and Performance Management and Retention.

These markets were also more likely to use practices that veered away from corporate policy. For example, they were more likely to be flexible in the areas of organisation structure, addressing title inflation, and differential compensation.

Although we need to gather further information to determine whether these practices were more beneficial, we do recommend that companies segment their countries by growth rates, and differentially invest in and provide flexibility to those with the highest growth rates.

To maximise your impact, make sure you keep these tips in mind:
1) Gather input on high-growth markets separately when designing a process or practice. Use this to generate new and different designs
2) Create a high growth market advisory board to tap into practices that already work in your company that can be transferred to other sites
3) Don’t implement practices that will potentially slow growth!

(c) 2011 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.